State budget would put off tough decisions until after election

Illinois Democrats on Tuesday rolled out a new state spending plan that puts off many tough decisions until after the November election by relying on a series of time-tested budget tricks.

To make ends meet, at least on paper, lawmakers would bump up how much money they think will come in, borrow from special funds, put off paying bills, lower estimated health care costs and skip putting in money to pay for raises for unionized workers.

The $35.7 billion spending plan — roughly $300 million more than this year’s budget — is a compromise that emerged after lawmakers declined to extend a temporary income tax increase that’s set to start expiring in January but also refused to make deep cuts.

The House approved much of the budget Tuesday with the goal of finishing up before Saturday’s adjournment deadline. As is the case most years at the Capitol, the plans are in flux with final numbers still being ironed out.

Speaker Michael Madigan acknowledged the budget proposal would leave unfinished business and vowed to spend the summer and fall working to get the income tax hike made permanent to provide more money to run state government. The approach also ensures the governor’s race will continue to be framed up by opposite positions on a tax hike Democratic Gov. Pat Quinn and Republican challenger Bruce Rauner have staked out.

“My expectation is that this issue will be taken into the general election and I think the governor will be supportive of an extension of the income tax increase through the general election,” Madigan said. “My expectation is that Mr. Rauner will be against. So you'll have a clear line of division going into the election. And people can make their choice.”

The Quinn administration isn’t happy with what’s being put together.

“It's clear it's incomplete,” said Quinn spokeswoman Brooke Anderson. “But the governor is working to protect critical priorities, including public safety, education and core services for our most vulnerable. This budget does not avoid the tough decisions, it just postpones them.”

Rauner has been campaigning for more than a year to let the tax hike expire but has not offered specifics on how to put a budget together, saying he’ll offer a plan “in due time.” On Tuesday, his campaign offered no comment.

The budget moving ahead at the Capitol does not rely on extending the income tax increase, which went from 3 percent to 5 percent in January 2011 and stands to drop back to 3.75 percent early next year. If that happens, state coffers would take a $2 billion hit in the next budget and $4 billion in the one after that.

It’s the third budget plan to surface in two weeks. The initial plan envisioned that the tax hike would be made permanent, but there weren’t enough votes in the House. Last week, a plan that included major cuts as a result of losing the tax hike revenue got just five votes in support.

The latest plan tries to find a middle ground, but relies on what critics dismissed as gimmicks and tricks.

About $650 million that had been going to pay down a stack of billions of dollars in overdue bills in recent years instead will go to balance the books. Another $650 million would be borrowed from hundreds of funds that are set aside for specific special purposes. Still another $380 million would come from delaying payments for state employee group health insurance.

Rosier revenue estimates, long a staple of Statehouse budgets, also are on the table this time. The state is now estimating it will collect another $200 million in the new budget year that starts July 1.

The budget blueprint also does not include millions of dollars in raises for state workers that are part of union contracts. Madigan acknowledged that could mean layoffs, noting that agency directors are used to getting less money than they request.

“I think the other state agencies have learned from this experience how to go about managing their agency with less employees than they have had in the past,” said Madigan, D-Chicago.Unions representing government workers are opposed, saying the pay hikes are contractually obligated.

“This so-called ‘flat’ budget actually continues real and harmful cuts,” said Anders Lindall, spokesman for the American Federation of State, County and Municipal Employees. “In the prisons, we're told it could mean four facility closures, the premature release of 5,000 criminals into Illinois communities and hundreds of lost jobs.”

Chicago Democratic Rep. Greg Harris said the state will be able to squeak by for a few months, but the cuts will be more acutely felt in January.

“People will not stop being disabled, people will not stop getting elderly simply because we don’t have the ability to raise the revenue to pay for it,” said Harris, who chairs the human services appropriations committee. “So the providers are going to be faced with the fact they are going to be serving those people until their appropriation runs out.”

Republicans argued it was irresponsible for Democrats to push a spending plan that relied so heavily on borrowing, saying that practice it what helped get Illinois into such a financial mess in the first place.

“It has to be paid back,” said Rep. Ron Sandack, R-Downers Grove. “That’s a reason why this ‘middle of the road’ budget is such a farce.”

The new spending plan would increase education spending by $118 million. Most of that would go into keeping the basic general state aid distributed to various districts at 89 percent of where state law says it should be. That’s the level in the current budget.

But the budget also would cut $137 million from community care programs that serve the elderly at home. Another $7.8 million would be cut from programs that provide in-home care for the disabled. Funding for child care for the poor would be cut by $24 million, one legislative analysis showed.

Also eliminated would be $10 million for grants for after-school programs and another $15 million that funded anti-violence programs that arose from Quinn's troubled Neighborhood Recovery Initiative. Republicans argued the Democrats moved money into different agencies to keep some of the programs going.

The cuts aren’t likely to go over well in the Senate, where Democrats have a larger majority and tend to favor more social spending, not less. Senate President John Cullerton, D-Chicago, remained supportive of making the income tax increase permanent, but acknowledged lawmakers have to deal with the political reality of the situation.

“We made the arguments as to why there's the need for revenues,” Cullerton said, “But we don't have it. So now we're proceeding with passing the budget.”

As the General Assembly works to finish up by week’s end, the House on Tuesday also approved two measures related to a pair of Illinois presidents.

The House voted 84-29 to send the Senate a Madigan proposal to make the Abraham Lincoln Presidential Library and Museum a free-standing agency. The measure could help some of the speaker’s friends, including Eileen Mackevich, who runs the Lincoln presidential museum in Springfield. She is a longtime acquaintance of Stanley Balzekas, whose family runs the Balzekas Museum of Lithuanian Culture and is Madigan’s landlord for his 13th Ward office. A cache of emails released Tuesday through an open records request showed the idea that Madigan dropped on legislators during the last week has been in the works for much longer.

The House also sent the governor a bill that would allow the state to loan or donate items used by then-state Sen. Barack Obama during his time in the Illinois legislature. The items could include things like books, furniture and equipment and could be added to a future Obama library and museum. Currently, such items are property of the Secretary of the Senate.